Amardeep (AVP) (24 Points)
14 August 2011My mother wishes to gift some money (more than 50000) via cheque/gift deed to my un married sister. Sister has her own PAN number ans she files her return.
I have 2 queries:
1. Does my mother/sister need to pay any Gift tax?
2. Will the income from this gifted money become taxable in my sister's name OR does it need to be clubbed with my mother's income?
Please clarify...
Devendra
(Chartered Accountant)
(4775 Points)
Replied 14 August 2011
It is not Taxable as Gift to relatives is exempt from tax. "Daughter" comes under the definition of relative. Also it is advisable to make a Gift deed on a simple Rs. 10 Stamp Paper.
Regards,
Devendra K
CA BINDU RANI
(Assisstant Manager)
(24 Points)
Replied 14 August 2011
also income earned on gift is not clubbed in hand of mother as income of minor, wife, or daughter in law is only clubbed in other hands. income recived by investing gift income is taxable in hand of daugther
Robin
(AUDITOR)
(854 Points)
Replied 14 August 2011
There is nothing much to celebrate in case of provisions of GIFT because, the gift amount which you are giving has
already been suffered Income tax and will again suffer income tax when you earn money out of that gift. The provisions of
Income tax are fun reading exercises. Simply enjoy and apply 
TRILOK SUREKA
(CA CS student)
(40 Points)
Replied 14 August 2011
Gift will be comes u/s 56 ii(vii) of income tax act 1961 gift made within meaning of Relative is not taxaable
is gigted amount received by minor hands than parents income not clubbed for the same if the parents earn the intrest amount on behalf of the minor gift received the it will b clubbing of income
Sandeep Surana
(Practicing Chartered Accountant)
(156 Points)
Replied 14 August 2011
1. No, Doesn't required to pay any gift tax
2.Gift money neither taxable in sister name and nor clubed income from such money in mother income.
CA.Raghuveer.K
(CA)
(97 Points)
Replied 15 August 2011
NO..it is not taxable in the hands of receiver and clubbing provision will not apply
Karan heda
(Service)
(39 Points)
Replied 15 August 2011
I think it is taxable. Why it is not taxable ?
only gifts in contemplation of death & at the time of marriage are exempt
Sandeep Surana
(Practicing Chartered Accountant)
(156 Points)
Replied 17 August 2011
Mr. Karan, your question is "Why it is not taxable ?"
Ans.. For reference and more detail you see Section 56(2) of Income Tax Act, 1961. this section says, if Gift received from Relative, is always fully exempt from tax.
Relative defination is also given in this section which also includes assessee's Child(if married or unmarried)
Hence in the above case, gift received from Daughter in any manner is fully exempt from Tax.
Note: Clubing Provisions is limited provision and applicable on those person for which section says.
In above case clubing provision not applicable therefor Income from such Gift is not included in Mother's(assessee's) income.
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